Can the seller enter a new contract without returning my earnest money deposit?
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Can the seller enter a new contract without returning my earnest money deposit?
I was buying a house and seller was also the real estate agent. The home inspection addendum required the work be done by a licensed contractor. When we received the invoices from the work done, we found out the seller didnt hire licensed contractors. We gave her a second chance and again, she hired someone who was not licensed. We showed up to closing having fulfilled our end, but because she breached the contract, we did not buy the house and requested our EMD. She
refused to release the funds and now we saw that she has listed the property as pending under a new contract. I believe it is illegal for her to have signed a new contract before releasing our EMD and ending our contract. What is the best route of action to ensure our deposit is returned?
Asked on December 10, 2017 under Real Estate Law, Maryland
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 6 years ago | Contributor
Your *only* route to get the money is to sue her and show in court, by a "preponderance of the evidence" (that it is more likely than not) that she breached the contract in a material (imporant) way, thereby allowing you to treat the contract as terminated. (A material breach by Party 1 to a contract allows Party 2 to, at its option, consider the contract to be terminated.) Assuming you can do that, you can get court order for the release of the money. Based on what you write, you should be able to do this, since the contract required licensed contractors but you have evidence they were not licensed.
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